Decomposition of culms (sheaths and stems) of the emergent macrophyte Phragmites australis (common reed) was followed for 16 months in the litter layer of a brackish tidal marsh along the river Scheldt (the Netherlands). Stems and leaf sheaths were separately analyzed for mass loss, litter-associated fungal biomass (ergosterol), nutrient (N and P), and cell wall polymer concentrations (cellulose and lignin). The role of fungal biomass in litter nutrient dynamics was evaluated by estimating nutrient incorporation within the living fungal mass. After 1 year of standing stem decay, substantial fungal colonization was found. This corresponded to an overall fungal biomass of 49 ± 8.7 mg g-1 dry mass. A vertical pattern of fungal colonization on stems in the canopy is suggested. The litter bag experiment showed that mass loss of stems was negligible during the first 6 months, whereas leaf sheaths lost almost 50% of their initial mass during that time. Exponential breakdown rates were -0.0039 ± 0.0004 and -0.0026 ± 0.0003 day-1 for leaf sheaths and stems, respectively (excluding the initial lag period). In contrast to the stem tissue—which had no fungal colonization—leaf sheaths were heavily colonized by fungi (93 ± 10 mg fungal biomass g-1 dry mass) prior to placement in the litter layer. Once being on the sediment surface, 30% of leaf sheath's associated fungal biomass was lost, but ergosterol concentrations recovered the following months. In the stems, fungal biomass increased steadily after an initial lag period to reach a maximal biomass of about 120 mg fungal biomass g-1 dry mass for both plant parts at the end of the experiment. Fungal colonizers are considered to contain an important fraction of nutrients within the decaying plant matter. Fungal N incorporation was estimated to be 64 ± 13 and 102 ± 15% of total available N pool during decomposition for leaf sheaths and stems, respectively. Fungal P incorporation was estimated to be 37 ± 9 and 52 ± 15% of total available P during decomposition for leaf sheaths and stems, respectively. Furthermore, within the stem tissue, fungi are suggested to be active immobilizers of nutrients from the external environment because fungi were often estimated to contain more than 100% of the original nutrient stock.